No Such Thing as a Handshake Deal

ANDREW LUMB, Senior Counsel with Nevett Ford Melbourne Pty Ltd comments on the preparation of a simplified version of the Transport Contract developed for the use of CMPA members.

ALTHOUGH arising out of timber industry issues and to a large extent directed towards timber cartage contracts, the Owner Drivers and Forestry Contractors Act 2005 (“ODFC Act”) significantly changed the landscape for the wide range of industries using cartage contractors, including extractive industry.

The ODFC Act applies to the engagement of harvesting contractors, haulage contractors (both relating to forest products), and generally speaking to all owner drivers.

As most people are aware, the ODFC Act specifies several requirements for contracts under which owner drivers are engaged, including but not limited to a requirement that contracts must be in writing, and also imposes a number of obligations on hirers. In addition a Code of Practice has been introduced in regulations under the ODFC Act incorporating further restrictions and requirements.

While no specific penalties are prescribed in the legislation for non-compliance with any obligation the ODFC Act addresses unconscionable conduct and provides processes for dispute resolution and ultimately for disputes to be dealt with by VCAT, which is given a wide range of powers.

At much the same time as the ODFC Act was introduced “the chain of responsibility” initiative led to legislative changes, in particular to the Road Safety Act, which pushed back up the chain of control responsibility and liability for breaches by drivers of road laws and other applicable laws and regulations.

It was probably the case that in the past many businesses, particularly smaller ones, used owner drivers without written contracts. This ceased to be a viable option after the ODFC Act and the chain of responsibility measures. Apart from questions of compliance with the ODFC Act, business owners now need to ensure compliant practices and accountability on the part of owner drivers.

The problem which emerged after discussions with Bruce McClure, General Manager CMPA, Tony Tamburro, Logistics Manager Conundrum Holdings and Tim Bird of Allstone Quarries was largely a practical one. Tony had been trialling the long form of contract developed by the CMPA, but take up had been very slow due to its size and perceived complexity.

The reality was that owner drivers did not want to go to the expense of taking legal advice, and to get acceptance it was necessary to present an agreement short enough and clear enough for them to feel confident about signing. After these discussions, we at Nevett Ford Lawyers proceeded with preparation of what hopefully would be a short form contract. However, a minimal document inevitably means less layers of bulletproof comfort and can be a delicate exercise.

The document we have developed is intended to be concise and simple to use and covers the basic legal and other compliance obligations including the mandatory requirements of the ODFC Act and other statutory obligations, as well as the specific payment and other contract terms.

However, it became clear that frequently businesses have individual procedures requirements and rules for the contractors they use in their businesses. For example the contractor may be required to have a fatigue management plan, or a maintenance plan for vehicles, and to provide the Hirer with copies of these and evidence of compliance.

The form of contract developed makes provision for these individual requirements to be inserted in an Annexure to the contract. In addition in some cases the Annexure incorporates sections which are to be completed by the Contractor to include vehicle, driver and insurance details.

We have been able to assist several CMPA members with contracts using the basic simple contract with an Annexure incorporating tailored individual terms and conditions.

Any CMPA member who would like to obtain a copy of the Transport Contract please contact:

Mr Andrew Lumb at Nevett Ford Melbourne Pty Ltd.
Phone: (03) 9614 7111
Email: alumb@nevett ford.com.au

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